For multinational companies, the need for efficiency has gone global.

But while financial, information technology, and human resources practices get more and more centralized, incentive and promotion practices remain local. This makes sense: Local sales managers and marketers have a better chance of knowing how particular incentive and marketing programs will affect the target audience.

With that said, the advertising industry has discovered it can add significant value to multinational clients by helping them better coordinate campaigns and efforts, not only to make sure overall brand integrity remains intact from culture to culture, but to ensure media and other services are purchased with maximum efficiency of scale.

In the case of incentive programs, multinationals have made less progress in the daunting task of managing international expenditures for sales, reseller, employee, and customer incentive and recognition programs. Yet the benefits are real, if they can extend the same thinking behind multinational advertising and apply it to incentive and recognition programs. That means developing an international strategy with the freedom for local offices to adapt it to their cultures.

The Benefits: Developing more scientifically-based principles of program design that get applied everywhere—no matter what the culture, we're all humans; developing a clear distinction between rewards/recognition and pricing/compensation; and creating a rewards and recognition platform that can be accessed internationally based on the needs of individual countries.

The Results: A clearer idea of return-on-investment on what is in many countries a significant selling expense; getting better buying power for awards and recognition; getting a more accurate tally of the overall expenses involved; and getting more real-time information about program impact. Most companies can tell you their advertising budget; very few can easily break out their incentive budgets.

Today the Internet, improved logistics, and the presence of more and more professional incentive and marketing agencies in European, Australasian, and even Asian countries, have made it possible to bring international incentive and recognition planning to a new level of sophistication.

KEY STEPS

Here are some of the key steps involved in implementing a global approach to incentive program design.

Understand What Research Says
Many executives are under the mistaken impression that there is little research backing up the effective use of incentive programs. In fact, solid research not only confirms the positive impact of incentive programs but also sheds light on the best ways to implement them. A recently released study, "Rewards, Motivation, and Workplace Performance," found that professionally designed incentive programs improve performance by up to 44 percent in teams and 25 percent in individuals, but only if they address the following issues: Agency—a fancy term for employee buy-in; Job satisfaction—a sense that employees have input into their job design and get fair recognition for performance

Communication—information that aligns employee actions with organizational goals or marketing claims; emotional mood—no programs work well if employees are otherwise discouraged; capability—the ability of employees to meet the goals; analysis and feedback—the ability of the organization to monitor what's going on, provide feedback to employees, and make changes in the programs.

Identify Unifying Themes
While an organization's goals can differ from region to region, there generally are overall corporate goals or marketing promises that apply across the board. Identify those overlapping messages and make sure the message gets driven home to your regional offices. A unifying international theme often can be incorporated into localized programs designed to meet specific goals. If you do resort to an international theme, make sure you have carefully read up on the cultural elements of each of your regions to make sure you don't run afoul of local sensitivities—even before you get input from your regional office.

DEVELOP A COMMUNICATIONS TEMPLATE

Be Sensible to Local Culture
Recent political events demonstrate how poor communication and understanding can thwart the best ideas and intentions. Recognize that people outside the U.S. have as much pride in their own cultures as Americans do in theirs, and that many people resent overly aggressive U.S. tactics that appear to run roughshod over local sensitivities. These elements of pride run so high that even the best ideas or intentions can get subtly blocked on a local level unless you carefully involve your local partners in program design.

Develop Sensible Standards
Even if regional offices have the ability to design their own programs, make sure those programs conform not only to incentive program research but are designed so that results can feed back to corporate headquarters for analysis. Incentive program budgets can become a black hole for expenses if not carefully monitored, yet most organizations do a poor job of monitoring international programs. Online incentive technology can facilitate international information flows.

Consider a Single Award Solution
Until recently, it was nearly impossible to find a single vendor capable of serving a multinational company. Today, new award options make it possible to develop a highly customizable set of award options redeemable locally and even customizable to fit local cultures. The numerous advantages include: economies of scale, ability to track worldwide redemption patterns, and ability to get more information about local program results. Make sure your international solution includes a seamless fulfillment process so that people outside the U.S. feel they get the same treatment and standards as U.S. employees or customers.

Consider Multilingual Marketing
Some U.S. multinational companies assume all of their international employees should speak English; others leave all translations to local offices. Today, with the Internet and state-of-the-art publishing technology, it is possible to more centrally control translations and marketing in order to get better control of the communications and costs involved in international communications. Centralized multilingual marketing, if managed by an experienced service provider, can reduce costs but, just as importantly, ensure that your local offices stay true to the necessary messages.

BOOKS

Kiss, Bow, or Shake Hands: How to Do Business in Sixty Countries, by Terri Morrison, is useful for companies planning a program overseas, although it contains some oversimplifications. $19.95. Available through Amazon.com, $13.97.

ASSOCIATIONS